State Bank of India on 28
th March 2017 announced offering credit cards to account holders with a balance of INR 20,000-25,000.
The card called Unnati will be offered through a network of 20 thousand plus SBI branches.
SBI will not consider the customer's credit history. Card called Unnati will be issued free for first four years.
Lack of credit history will be the challenge in increasing card penetration in the country. Card will facilitate generation of credit history for fresh users which will bring them into the organised financial stream.
To encourage adoption of credit cards and facilitate expansion in the reach of digital payments, the SBI Card Unnati will be offered free, at zero annual fee, for four years.
SBI has close to 30 crore customer accounts, including Jan Dhan Yojana. Post-demonetisation the balance amount in these accounts increased significantly.
Many customers do not have credit history and are not eligible for cards. SBI wants to bring about financial inclusion in terms of credit facility with this new product.
The Bank is also in the process of increasing its stake in SBI Card to 74 per cent.
SBI currently holds 60 per cent stake in SBICPSL and 40 per cent in GECBPMSL.
The balance being held by GE Capital in both the ventures.
The SBI has approval to infuse Rs 1,160 crore in the two JVs - SBI Cards and Payment Services Pvt Ltd (SBICPSL) and GE Capital Business Processes Management Services Ltd (GECBPMSL)- through purchase of equity shares from GE Capital.
This is to increase the bank's stake in both the companies to 74 per cent.
The nation's largest lender SBI entered credit card business in 1998 by roping GE Capital India, the consumer finance arm of US-based GE Capital.
SBI Card, having 4.3 million user, said its latest offering 'Unnati' targeted at all SBI customers, including Jan Dhan account holders throughout the country.
SBI: Know More- Founded: 2 June 1806, Bank of Calcutta/ 27 January 1921, Imperial Bank of India/ 1 July 1955, State Bank of India/ 2 June 1956, nationalization
- Headquarters: Mumbai, Maharashtra, India
- Area served: Worldwide
- Chairperson: Arundhati Bhattacharya
- Products: Consumer banking, corporate banking, finance and insurance, investment banking, mortgage loans, private banking, private equity, savings, securities, asset management, wealth management, credit cards.
